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Published:  2015-02-10 Views:  764
Author:  galaxybuilders
Published in:  Real Estate
Good And Bad Of Buying Investment Property

If you are planning to have a property and want to make it a part of your investment plan then follow the advice and give it a second opinion. Buying or making an investment into a Property can both be a risk or profitable for you.

There are varied reasons people purchase investment property. Some buy it to get some deduction into the taxes they have to pay and some invest into property to earn some extra income to their savings. Whatever may be the reason behind it one could never deny the fact that people get lured by the investment plans because of benefits property investment provides to the investors.

The interest charged upon investment loan is generally tax deductable which is another benefit and can be used to claim lesser tax payment. The important reason behind making an investment into a property is also they get higher borrowing power with an investment loan rather than having a nominal home loan.

Investing into the property market provides various assistance to the investors. In the recent trend you can say that property investment market is more stable than any other market. Investment property provides fixed returns to the investors.

Another benefit is the constant rental payment you receive from your tenant which is the generally higher than the mortgage repayment. You do not have to invest any extra funds to pay off the loan and simultaneously you can also avail surplus funds to cover any property costs that may have incurred.

The profit can be maximized if your property location is feasible for the tenants. Yes that the most important factor people generally opt for is at what place is the property located. Naturally the basic conveniences are demanded by every tenant and your property location must fulfill that criterion to maximize your profit in terms of rent you are willing to avail from your property.

The other side of the coin is everything comes with a disadvantage as well. You may get lured by the lump sum surplus you get from your investment but the initial charge incurred to buy your own property is higher than normal and sometimes beyond your imagination.

Another drawback you can face is the long duration of time you will face to sell the property in case of any financial crises. Another scenario you can face is sometimes you will need to sell the property at a lesser expected price and incur huge loss if your property is not located in a place with is according to the convenience of the tenant.

Additional drawback is that if you have purchased the property and you wish to rent it out immediately that would not be possible. You will naturally need some time to hunt for a perfect tenant fulfilling your demand and satisfying your requirement but in that case you will also need to pay some extra charges such as maintenance and mortgage repayment while your property is occupied by a perfect tenant.

The most common problem you face is your tenant moves out after their contract expires and in that case you can face financial hardships. You may also have to overcome some differences between lesser income and higher mortgage if you fell short of the rent amount.

We wish you happy investment with larger surplus.

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